Cross industry group sets new standard with revised bunker contract
Overview
BIMCO’s Documentary Committee approved a new set of standard bunker terms, developed by a cross-industry group, in New York on 2 May. The BIMCO Bunker Terms 2018 improve on the previous edition with a maximum limit of the parties’ liabilities – a key change that will lead to wider adoption of the contract.
“I think it is a positive step for the industry that representatives for the bunker traders and shipowners have agreed on a standard set of terms, which both parties consider fair and balanced,” says Francis Sarre, Chair of the BIMCO Documentary Committee.
The trader representatives who helped draft the contract together account for 25% of the total bunker volume sold globally, which BIMCO sees as a very strong sign of support for the final result. The BIMCO Bunker Terms 2018 also have the support of IBIA – the International Bunker Industry Association.
Francis Sarre hopes that the changes to the terms and the broad support will lead to a wide adoption of the standard terms across the industry, which will improve and speed up bunker transactions and reduce disputes.
“We all need to improve efficiency and cut costs. With a widely used standard contract all parties involved should save time on drafting contracts and get greater clarity on the contractual obligations and liabilities in the contract. This will hopefully bring more transparency to the bunker industry,” Sarre says.
Cap on liabilities
The BIMCO Bunker Terms 2018 therefore include a default limit of the invoice value or USD 500,000, whichever is higher. The USD 500,000 is just a default minimum figure that the parties can increase if appropriate.
The BIMCO Documentary Committee consists of over 60 people from across the shipping industry, including: shipowners, ship operators, representatives from P&I clubs and national shipowner and shipbroker associations. The committee also has several observers including the International Group of P&I Clubs, the International Chamber of Shipping, INTERTANKO, FONASBA and the Maritime Law Association of the US.
The Documentary Committee met on 2 May, in New York, hosted by the Maritime Law Association of the United States.
The new BIMCO Bunker Terms 2018 will be available shortly on BIMCO’s website.
Feedback or a question about this information?
Posted:
03 May 2018
VPS Bunker Alerts
Veritas Petroleum Services (VPS) publish regular Bunker Alerts based entirely on fuel samples and have kindly permitted BIMCO’s Members to access this information.
The Bunker Alerts are not intended to be an evaluation of overall bunker quality in the port or area concerned, but usually highlight a specific parameter within the fuel which has raised a quality issue.
Latest ice reports for members
Latest piracy reports
Latest industry releasable threats
Related publication
Ship Management Contracts
The handy guide contains explanatory notes to all of BIMCO’s current standard ship management contracts.
Related training
Commodity Trading & Chartering Masterclass Online
- Online, Online
- 03 February, 2025
Commodity Trading & Chartering Masterclass Online is a series of 10 online sessions delivered over 5 days. Each day will run for 2x75 minutes with a short break...
ELSEWHERE ON BIMCO
Contracts & Clauses
All of BIMCO's most widely used contracts and clauses as well as advice on managing charters and business partners.
Learn about your cargo
For general guidance and information on cargo-related queries.
BIMCO Publications
Want to buy or download a BIMCO publication? Use the link to get access to the ballast water management guide, the ship master’s security manual and many other publications.
About a new business partner
We can help members check new business partners. We also help to recover millions of USD (undisputed) funds every year.
